BOCA RATON, FL—FriendFinder Networks Inc. filed a Chapter 11 petition in U.S. Bankruptcy Court in the District in Delaware today, listing total assets of $465,000,000 and total debts of $661,967,000, with an estimated number of creditors listed at under 50. According to the filing, debt securities are held by more than 500 holders.
FFN describes its business model as, “The debtor, together with its subsidiaries, is an internet and technology company providing services in the social networking and web-based video sharing markets, and is also engaged in entertainment activities consisting of publishing, licensing and studio production and distribution.” The petition was signed by FFN President and CEO Anthony Previte.
According to Reuters, “FriendFinder has not turned in a net profit at least since 2008, Thomson Reuters data shows. Total revenue for the four consecutive fiscal quarters ended June 30, 2013 was $293.70 million, a filing showed.”
The filing comes after a meeting of the FFN board of directors on Monday, at which time a resolution was adopted to retain the law firm Greenberg Traurig LLP for the purpose of filing for Chapter 11 bankruptcy protection and reorganization.
"Despite continuing member interest and high volume traffic, the debtors did not make certain payments to the holders of existing first lien notes and cash pay second lien notes which constituted a default under their respective indentures," said the company.
According to NBC News, "The company, which sought to combine social networking and sex, said it had struck a deal with noteholders that will reduce its debt by $300 million if approved by the U.S. Bankruptcy Court in Delaware.
"Under the plan," it continued, "one group of noteholders will take ownership of the sex entertainment business, which traces its roots to the late Penthouse publisher Bob Guccione. As is typical in bankruptcy, shareholders will likely be left with nothing.
"Control of the company would go to Andrew Conru and Lars Mapstead, two noteholders who sold various social networking websites to FriendFinder in 2007," NBC added.
The list of "affiliated entities, including the Debtor filing this petition (collectively, the 'Debtors'), that filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware, contemporaneously with the filing of this petition" includes:
1. Argus Payments Inc.
2. Big Island Technology Group, Inc.
3. Blue Hen Group Inc.
4. Confirm ID, Inc.
5. Danni Ashe, Inc.
6. Fastcupid, Inc.
7. Fierce Wombat Games Inc.
8. FriendFinder California Inc.
9. FriendFinder Networks Inc.
10. FRIENDFINDER VENTURES INC.
11. FRNK Technology Group
12. General Media Art Holding, Inc.
13. General Media Communications, Inc.
14. General Media Entertainment, Inc.
15. Global Alphabet, Inc.
16. GMCI Internet Operations, Inc.
17. GMI On-Line Ventures, Ltd.
18. Interactive Network, Inc.
19. Magnolia Blossom Inc.
20. Medley.com Incorporated
21. NAFT NEWS CORPORATION
22. Penthouse Digital Media Productions Inc.
23. Penthouse Images Acquisitions, Ltd.
24. PerfectMatch Inc.
25. Playtime Gaming Inc.
26. PMGI Holdings Inc.
27. PPM Technology Group, Inc.
28. Pure Entertainment Telecommunications, Inc.
29. Sharkfish, Inc.
30. Snapshot Productions, LLC
31. Streamray Inc.
32. Streamray Studios Inc.
33. Tan Door Media Inc.
34. Traffic Cat, Inc.
35. Transbloom, Inc.
36. Various, Inc.
37. Video Bliss, Inc.
38. West Coast Facilities Inc.
39. XVHUB Group Inc
